Philadelphia Health Company Agrees to Settle Allegations of False Claims Act Violations for Vascular $3.825 Million

The U.S. Department of Justice (DOJ) reported on October 23, 2018, that whistleblowers helped force a Philadelphia, Pennsylvania company and its 23 related corporations to agree to a $3.825 million settlement of charges it violated the False Claims Act. The company, Vascular Access Centers L.P., and its subsidiaries are collected called “VAC.”

The False Claims Act is a federal law that allows the government, with the help of whistleblowers, to seek repayment of any bills that were falsely submitted to federal agencies and to collect fines and penalties. The DOJ claimed that that VA billed Medicare, a federal agency, for vascular access procedures that were not reimbursable.  The procedures were “performed on End State Renal Disease (ERSD) beneficiaries.” VAC was also charged with committing an anti-kickback scheme related to the referrals for these procedures.

According to the DOJ, VAC has businesses in eight different states. The procedures included fistulagrams and percutaneous transluminal angioplasties. The DOJ asserted that VAC failed to provide the required documentation to show that these procedures were reasonable and necessary.

The DOJ also asserted that VAC violated the Anti-Kickback statute when it submitted false claims to Medicare based on improper referrals. The Anti-Kickback Statute regulates when and how referrals can and cannot be made in order to get business. The aim of the AKS is to protect the patient so that physicians and medical practices don’t offer unnecessary services or services that aren’t meant to help the patient – just to get the referral or more referrals.

The terms of the settlement agreement and the whistleblower award

VAC agreed to pay the $3.825 million minimum over a period of five years. If certain conditions are met, the amount could escalate to $18.36 million.  In addition to agreeing to pay substantial sums of money, VA also agreed to significant compliance efforts to show it is meeting the terms of the False Claims Act and the Anti-Kickback Statute.

The Assistant Attorney General for the DOJ’s Civil Division emphasized that patients with ERSD have the right to expect they will receive medical care based on their “clinical needs and not based on the financial interests of healthcare providers.”

Violations of the False Claims Act don’t just hurt patients. They hurt other honest medical practitioners who are doing their best to help their patients. Improper billing and false claims also hurt the American taxpayer who pays the bill for improper services.

There were two whistleblower lawsuits in this case. The whistleblowers were awarded $612,000 combined for their contribution to forcing a settlement. Whistleblowers, under the qui tam provisions, of the False Claims Act are entitled to a strong percentage of any recovery.

Stephen Danz & Associates has the experience and resources to help whistleblowers file valid claims through the False Claims Act and other whistleblower laws. We guide whistleblowers through each stage of the litigation process. Please call us at 877-789-9707 for skilled whistleblower advocacy.